The residential leasing market remained soft last month, with rents of both private homes and HDB flats continuing their downward drift.
Private rents slipped 0.8 per cent in November from a month ago, according to flash estimates by SRX Property. Rents of HDB flats fell 0.9 per cent during the same period.
The rental drag in the private segment came from all regions, with the prime or Core Central Region (CCR) down 0.7 per cent; and the city fringe or Rest of Central Region (RCR) and the suburban or Outside Central Region both falling 0.9 per cent.
HDB three-room, four-room and five-room flats saw rental declines of 1.6 per cent, 0.5 per cent and 1.1 per cent respectively, while rents for HDB executive flats inched up 0.8 per cent during the month.
HDB three-room, four-room and five-room flats saw rental declines of 1.6 per cent, 0.5 per cent and 1.1 per cent respectively, while rents for HDB executive flats inched up 0.8 per cent during the month.
But the decline in rents - which has seen private home rents decline 18.9 per cent from its peak in January 2013 and HDB flat rents down 12.2 per cent compared to its peak in August 2013 - did not spur more rental transactions in November, based on SRX Property estimates.
The estimated rental volume of 3,811 private units in November was 0.5 per cent lower than in October, though it is 20.8 per cent more than in November 2015.
SRX Property's estimate for HDB rental volume at 1,747 HDB flats in November was also 1.3 per cent lower than in October and 7.3 per cent lower compared to November 2015.
Ong Kah Seng, director of R'ST Research, said that the fact that rental prices and volume fell simultaneously in November was "well within expectations" as leasing conditions remain soft amid substantial new completions. "The year-end usually sees reduced expatriate inflow," he said, adding that some expats may have returned to their home countries after their employment contracts were not extended.
"Also, although private residential rentals have fallen to more affordable levels for tenants, it is still generally unable to result in very significant leasing interest as tenants remain cost-sensitive in their choices."
Flash reports on rentals by SRX Property typically capture around 80 per cent of the month's transactions on average at the time of their publication.
Volume estimates for transactions not yet captured are based on the estated agencies' historical submission pattern and timeline, taking into account seasonal periods during the year.
Get a more detailed Rental Analysis for November from SRX Rental Flash Report here.
As published on The Business Times.
Get a more detailed Rental Analysis for November from SRX Rental Flash Report here.
As published on The Business Times.
Source: SRX (Posted on 15 Dec 2016)